Merchants of all types depend on attracting new customers and securing the repeat business of existing customers. They have devised a variety of ways to provide incentives for their customers to return repeatedly, ultimately becoming loyal customers.
For example, many retail stores (such as grocery stores) issue prepaid vouchers, either paper or a plastic debit card, referred to as “scrip”, which is used by consumers as a cash equivalent to purchase products at the respective stores. Not-for-profit entities, such as schools, can purchase scrip in bulk at a discounted price and sell it to affiliated supporters (such as parents of the students at the school) at the full price, making a profit for the school.
Alternatively, some merchants contribute a percentage of the purchase price (possibly, for just certain items) to a not-for-profit (aggregator) of the merchant's choice, to one that a purchaser (participant) can choose from a list provided by the merchant or processor, or one that is separately identified by the participants. The term “aggregator” has been used to describe the entity or organization that aggregates some number of participants in the program, among other functions. The term “processor” is used to describe the central entity or organization that processes participant transactions from the merchant and passes the benefits through to the aggregator, among other functions.
Electronic scrip, developed by eScrip, Inc. of San Mateo, Calif., is a system in which a supporter registers some or all of his debit and credit, ATM cards and grocery loyalty cards with eScrip and designates the not-for-profit entity that will receive the rebate. Monthly payments to the not-for-profit entities are made through the EFT system. Monthly reports are also provided that allow the not-for-profit entities to track funds raised by individual families on a monthly and year-to-date basis. Purchases can be made both on the Internet and at bricks-and-mortar vendor locations. There are several drawbacks to the electronic scrip system. First, there is no privacy or security of information for the participant: the merchant, aggregator, and credit card company all possess key personal and financial information about the participant. Secondly, the method is almost entirely dependent on credit or debit transactions in order to track applicable purchases and does not apply to payment by any other means (with the exception of cash purchases consumers make from grocery stores using their loyalty card). Third, the method is dependent on the credit or debit card processor to provide all information on participant purchases.
The CardScrip program, introduced by the National Scrip Center also supports both Internet and “bricks-and-mortar” purchases, employs EFT deposits to entity accounts and provides a reporting function that allows entity tracking of individual families' activities. CardScrip suffers from all of the drawbacks of electronic scrip in addition to the prerequisite that the participant must apply for, and be accepted for, the National Scrip Center Mastercard and use it in all transactions with merchant vendors. This is likely to discourage potential users who do not want, cannot use, or cannot qualify for, another credit card.
Moreover, the above processes are not automated, nor are they integrated in a uniform environment. In addition, merchants may not have the time or funds available to initiate contact and set up programs for all aggregators and participants. Furthermore, merchants must print, maintain, secure, and account for their paper-based and debit card-based scrip offerings. It is also cumbersome for the not-for-profits to identify merchants, contract with them, track how much money to expect from a certain merchant and verify the amount that the merchant is obligated to pay the not-for-profit. Additionally, purchasers may have to carry with them scrip from a variety of different merchants. Likewise, there is no easy mechanism for the purchaser to keep track of how much money the purchaser has contributed to a respective not-for-profit through this program. Furthermore, the not-for-profit must invest money in carrying a float or inventory of available paper scrip for their supporters and those supporters must pay for scrip up-front and carry their own inventory or investment.
Therefore, there is a need for a more efficient system and method for coordinating and managing the entire process of the rebating by merchants of portions of consumer purchases to consumer-designated organizations, hereinafter referred to as the Collaborative affinity Marketing Program (CAMP).